Finance

Detroit's Pension Boards Sue to Block Cuts in Workers' Benefits

Detroit’s two pension funds today sued emergency manager Kevyn Orr and Gov. Rick Snyder in an attempt to block Orr from slashing pension benefits for thousands of current and active city workers as part of his plan to restructure the city’s massive debt.
July 18, 2013

Detroit’s two pension funds today sued emergency manager Kevyn Orr and Gov. Rick Snyder in an attempt to block Orr from slashing pension benefits for thousands of current and active city workers as part of his plan to restructure the city’s massive debt.

The lawsuit asks the Ingham County Circuit Court to declare that Snyder cannot authorize Orr to take any actions — including filing for municipal bankruptcy — that would cut pension benefits, which the lawsuit says are protected by the state constitution.

The lawsuit comes in the midst of tense negotiations between Orr and Detroit’s creditors that will determine whether the city files for bankruptcy. It also represents a strong pushback from the pension boards against Orr’s plan to make “significant cuts” to active and retired workers’ pension benefits.

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